Monday, August 15, 2011

opening grain market comments August 15th

The grain markets are called firmer this a.m. behind supportive outside markets and firmer overnight session.

In the overnight session we had corn up 4-5 cents, MPLS wheat was up 9-10, CBOT wheat was 10 higher,  KC wheat was up about a dime, and beans where up 7-10 cents.  At 9:20 outside markets are firmer with equities stronger as the DOW is up 165 points, Crude is about 1.75 cents firmer, the US dollar is softer by about 800 points  with the Cash index at 73.854, and European wheat is up about ½ to 1 percent.

Not a lot for new news out there for the grains.  The main driving forces for our prices as of late have been the weather as it relates to the yield and the outside markets as they relate to money flow.  Last week the USDA trimmed the yield for both corn and beans to levels that should make us ask if the yield reduction is already priced into the markets.  One thing that should be noted is that on the supply side of things we have to consider the outside markets shaky and our old crop supplies have been slowly moving up showing some sort of demand rationing. 

Our balance sheet trend isn’t as bullish as it once had been when it was month after month of cuts and smaller ending stocks.  Even with the decreased yields our balance sheet for 2011-2012 on corn is more then it was just a few months ago.

Basis is softer on spring wheat as the protein premiums have fallen out of bed as of late and we have seen corn basis softer as of late too.

Technically most of our markets remain sideways; still consolidating waiting to breakout one direction or another.  Most are near the high end of the range and we do have a good chance to see Dec corn trade at new highs in today’s session with the strong outside markets and lack of producer selling.

Please give us a call if there is anything we can do for you.

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